Perseus Mining has consistently worked to build its production profile in West Africa since it poured first gold from its Ghana-based Edikan mine back in 2011.
Now, following the successful start-up of its Sissingué mine in Côte d’Ivoire in January 2018, the company has ramped up efforts to bring its third mine Yaouré into production with speed – in turn, achieving another major milestone – to produce 500 000 ozpa from 2021 onwards, MD JEFF QUARTERMAINE tells LAURA CORNISH.
Perseus has come a long way since it produced its first gold from Edikan eight years ago. The company has taken drastic measures to ensure efficient production at the mine and has also brought its second mine Sissingué into operation.
With a multi-mine, multi-region strategy at the foundation of every step Perseus has taken, the company’s share price would do well to reflect on the numerous successes this company has achieved.
Nonetheless – its full steam ahead as the company invests its efforts in bringing operation number three – its 90% owned Yaouré project – into production.
Also situated in Côte d’Ivoire, Perseus is well-equipped to work in the country and has established a solid relationship and working repoire with the government.
Perseus Mining was given go-ahead from the board to start construction at Yaouré in May, shortly following the award of its exploitation permit.
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As a sign of government’s support for the project, ministers and officials visited the site in October and according to Quartermaine were pleased with the progress made on site to date.
“This was undeniably a resounding endorsement from the government.”
Progress to date
A notice of award for the engineering and supply contracts was issued to Lycopodium on 10 January 2019, and since then, Lycopodium and Perseus Mining’s in-house development team have worked to prepare for full-scale development.
During that period, detailed engineering was completed and supply contracts, including a contract with Outotec for the manufacture and supply of the SAG and ball mills, were conditionally awarded to suppliers of a large proportion of the plant and equipment required for the processing facility.
These orders have since been confirmed, fixing approximately 50% of the capital budget and enabling development to proceed on schedule.
“Our project timeline has not been negatively impacted to date by the rainy season, our civil works are on track and as of November the concrete was being laid for the CIL tanks foundation which are scheduled to arrive on site before the end of 2019,” Quartermaine outlines.
“Clearing of the area for the tailings dam is also underway, as is the on-site camp infrastructure.
Full mobilisation to site is imminent after which progress will start quickly moving forward.”
Perseus Mining will look to announce a mining contractor before year-end. Pre-stripping operations are scheduled to start in Q1, 2020.
“2020 is the critical year for Perseus as we push to get first ore into the mill by November 2020 – and so far we are looking in good shape although it is early days,” Quartermaine states.
The CEO has every confidence in the construction team, many of whom have been involved in the construction of the majority of the new gold process plants in West Africa, which includes Sissingué as well.
First gold is due to be poured at Yaouré by 23 January 2021, although a ‘stretch target’ and an earlier gold pour in December 2020 is being pursued.
The project is thus far coming in under budget – “all in all the project is moving ahead as expected and we’re excited to deliver on our commitments.”
A closer look at Yaouré and the bigger picture
The cost to take Yaouré through to production totals US$265 million, of which $132 million in spend had been committed up to September 2019. About $60 million of this has been spent and about $30 million paid.
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Based on the feasibility study completed in 2017, Yaouré will operate as a two open pit operation, producing 215 000 ozpa for the first five years of an eight-and-a-half-year lifespan (based on current reserves).
The plan is to operate at an all-in-sustaining cost of $740/oz, delivering an average grade of 2.2 g/t.
These numbers equate to a profitable operation but Quartermaine is already looking at the mine’s longer-term potential – which will see the mine quickly transition to become an underground operation.
“We have completed a pre-feasibility study on converting one of the open cast pits to an underground mine and have estimated a 600 000 oz resource at a high 6 g/t.
"Towards the end of our fourth year of operation at Yaouré we want to be moving ore from underground in order to maintain our 215 000 ozpa production target. An underground mine also offers the potential to continue operating beyond eight years.”
Perseus Mining will soon conduct a seismic study to determine where to drill the ore body to further delineate a bigger resource.
Quartermaine also notes that the company has detected soil anomalies adjacent to the two pits which could lead to additional open cast satellite pits and further lifespan extension.
To deliver 215 000 ozpa of gold, Yaouré requires a 3.3 Mtpa processing operation which will comprise the standard crusher, SAG, ball, gravity, regrind and CIL circuits.
Sustaining the production goal
For now, should Perseus Mining’s mine profile remain unchanged, the company would need to look at supplementing its gold output to maintain 500 000 ozpa in order to compensate for a natural drop in production from +-200 000 ozpa Edikan and +-85 000 ozpa Sissingué as the mines mature in the coming years.
No need for worry though – Perseus is comfortable until 2024 but nonetheless has already identified organic initiatives that could stretch the timeframe considerably further.
“We have had good exploration success at both mines and are certain we will upgrade our reserves within the first quarter of next year,” Quartermaine indicates.
This is part of a larger organic growth strategy which includes optimising existing resources, exploring and discovering new reserves in close proximity to existing operations and also Greenfields exploration.
“We want to maintain a development pipeline of projects and will evaluate what will be next in the pipeline as the delivery of Yaouré draws to a close,” Quartermaine concludes.